A frozen food business plan sets out what you'll make, who will buy it and at what price, where you'll make and store it, how it stays frozen all the way to the customer, and the first year month by month. What sets frozen food apart in a plan is the cold: freezer space and cold delivery are real costs in every box, and a store, or a distributor, wants the product to arrive frozen with plenty of shelf life left. In the example below, a maker of frozen taro patties reaches 2,000 wholesale boxes and 300 market boxes a month by month 11, makes a monthly profit from month 2, and ends the year about $24,200 ahead on top of paying for the kitchen hours. The tight spots aren't cash; they're freezer space, a 5,000-box printing minimum, and the price a distributor will pay. Below is a description example, each part of the plan, the projection, and a free template.
The short version
- Describe the business in a paragraph: the product, the customers, the kitchen, the cold chain, the goals.
- Cost a box with freezer space and cold delivery in it, not only ingredients and packaging.
- Price for stores, markets and, later, a distributor; each leaves a different margin.
- Plan freezer space for your peak, plus what's waiting for delivery.
- Check what printed-box minimums mean against your early volume.
- Project 12 months with sales ramping up.
- TaroStack dates every lot, sends the oldest out first, and tracks stock in every freezer. More below.
Part 1: the business description
Windward Roots, the made-up taro business I use in these examples, adds frozen taro patties. Its description reads:
Windward Roots Frozen makes taro patties, four to a box, frozen within hours of cooking in a licensed kitchen on Oʻahu. We sell to independent grocers and natural food stores, delivered frozen in insulated bins once a week, and at two Saturday markets. Every box carries a lot code and a best-by date. In the first year we plan to be in 20 stores, selling 2,300 boxes a month by month 11, and to add a distributor once our own deliveries are full.
Part 2: what a box costs
The costs come from how to start a frozen food business:
| Per box of 4 taro patties | Cost |
|---|---|
| Ingredients | $1.35 |
| Box, film and label | $0.62 |
| Labor | $0.90 |
| Kitchen and freezer rental | $0.55 |
| Cold delivery | $0.30 |
| Cost per box | $3.72 |
Freezer space and cold delivery are 85 cents of the $3.72, the two lines new frozen brands most often leave out.
Part 3: customers and prices
| Channel | Price | Variable cost | Contribution | Boxes a month at full speed |
|---|---|---|---|---|
| Stores, delivered | $5.50 | $3.72 | $1.78 | 2,000 |
| Markets | $9.00 | $3.69 | $5.31 | 300 |
The market box has no delivery cost but pays a 3% card fee. A distributor reaches more stores than you can drive to, but pays less: at $4.40 a box, collected from your freezer, the box leaves about 98 cents. That's the trade the plan should show before you sign one. What stores and distributors ask of a supplier is in requirements for selling food to grocery stores.
Part 4: operations
| Area | In the plan |
|---|---|
| Kitchen | A licensed kitchen; frozen foods generally can't be made under cottage food laws |
| Freezers | Space for your busiest week, plus boxes waiting for delivery, plus raw ingredients |
| Cold chain | Insulated bins, temperature loggers, delivery times |
| Packaging | Printed boxes, film, labels; the printer's minimum |
| Dates | A lot code and best-by date on every box; how much shelf life stores expect on arrival |
| Records | Each batch's ingredient lots and freezing time |
How much shelf life a store expects a frozen box to have left is in minimum remaining shelf life.
Part 5: the first year, month by month
Sales start at 15% of full speed and reach 100% by month 11, against $900 of fixed costs a month: marketing and store demos, market booths, freezer power, the website, software and card fees, and cleaning supplies.
| Month | Store boxes | Market boxes | Sales | Profit | Cash, year to date |
|---|---|---|---|---|---|
| 1 | 300 | 45 | $2,055 | −$127 | −$127 |
| 2 | 400 | 60 | $2,740 | $131 | $4 |
| 3 | 500 | 75 | $3,425 | $388 | $392 |
| 4 | 600 | 90 | $4,110 | $646 | $1,038 |
| 5 | 800 | 120 | $5,480 | $1,161 | $2,199 |
| 6 | 1,000 | 150 | $6,850 | $1,677 | $3,875 |
| 7 | 1,200 | 180 | $8,220 | $2,192 | $6,067 |
| 8 | 1,400 | 210 | $9,590 | $2,707 | $8,774 |
| 9 | 1,600 | 240 | $10,960 | $3,222 | $11,997 |
| 10 | 1,800 | 270 | $12,330 | $3,738 | $15,734 |
| 11 | 2,000 | 300 | $13,700 | $4,253 | $19,987 |
| 12 | 2,000 | 300 | $13,700 | $4,253 | $24,240 |
The first 5,000 printed boxes, bought before opening, last until about month 7 at this pace: cash that sits in a box store for half a year. By month 11, 2,300 boxes a month go out, and the freezers have to hold the busiest week's production and the next delivery's boxes at once. A plan that names the freezer capacity it needs at full speed, and when it buys the second freezer, is one a lender believes.
Part 6: the startup budget
| Item | Example |
|---|---|
| Freezers, used reach-in and chest | $2,500 |
| Sealer and packing equipment | $800 |
| Insulated bins and temperature loggers | $400 |
| Kitchen deposit and first month | $1,200 |
| Licenses and permits | $500 |
| Product liability insurance, first year | $1,200 |
| Printed boxes, first 5,000 | $2,000 |
| Ingredients for the first runs | $600 |
| Label and nutrition analysis | $700 |
| Working cash | $3,000 |
| Total to start | $12,900 |
Get the template
Download the frozen food business plan template. Type your products with their price, variable cost and monthly volume at full speed, your fixed costs and startup budget, and how fast stores will come on; it works out each month's sales, profit and cash, the first month with a profit and the lowest cash point. It's an ordinary Excel file with no macros, and it works in Google Sheets, LibreOffice and Numbers.
Where this stops working
The plan's freezer is a line in a budget. In the kitchen, it's three freezers with boxes from six batches, a store order to pack before 6 a.m., and a lot from last month at the back that a grocer won't take with only five weeks left. The spreadsheet says how many boxes were made; it doesn't say which freezer they're in, which lot goes first, or how many weeks each has left.
How TaroStack does it
TaroStack keeps every frozen lot's date, place and cost in front of you.
Every batch, dated and costed. Each product is a recipe. Recording a batch takes the ingredients off stock from the lots used, at what you paid, and puts the boxes into a lot with a best-by date from the item's shelf life, costed from what came out good.
The oldest out first, to the right customer. Orders are picked first-expired-first-out by default. Each store can carry its own rule for days of shelf life left on delivery, and a lot too short for that store is flagged. The expiry forecast shows what will expire before it's sold, and what it costs, while there's still time to sell it.
And the boxes in every freezer. Counts work on a phone, even in a walk-in freezer with no signal, and send themselves later; each count shows what a difference is worth before you post it. The reorder list shows printed boxes and film in days of cover, with a red line where an order placed today would arrive too late. A kitchen and a cold storage warehouse can each be a site, with transfers between them.
| The question | Spreadsheet | In TaroStack |
|---|---|---|
| Which lot goes out first? | The one in front | First-expired-first-out, per store's rule |
| What expires before it's sold? | Found too late | The expiry forecast |
| How many boxes in the freezers? | Counted with frozen fingers, maybe | Counted on a phone, offline |
| When to reorder printed boxes | When they run out | Days of cover |
Lots, expiry, counts, recipes and batches are on every plan, from $49 a month; planning and more than one site, like a kitchen and a cold store, are on Standard at $99. The first 30 days are free, with no credit card. If you'd like a hand setting up, ask, and we'll do it with you.